Austria Signs Major Finance Deal with Iran

Austria’s Oberbank has signed a credit deal with Tehran to boost exports to Iran, the first European lender to do so since anti-Tehran sanctions were lifted following the 2015 nuclear deal between the Islamic Republic and world powers.

“We are proud to be the first European bank to have reached this framework agreement after a year and a half of intense negotiations,” Franz Gasselsberger, the director general of the regional bank in Upper Austria, said in a statement, The Local Austria reported.

The deal was “highly anticipated by Austrian exporters”, he said.

“Our clients have numerous projects in the pipeline, which can now be implemented.”

According to Iran’s central bank, the contract is worth one billion euro ($1.2 billion) and will benefit 14 Iranian banks.

The Iranian signatories included veteran private banks such as Parsian Bank, Saman Bank, Eqtesad Novin Bank, Bank Pasargad, Karafarin Bank and the newly established Middle East Bank. Others were former state banks that have been privatized over the past few years such as Bank Melli Iran, Bank Mellat, Bank Sepah, Tejarat Bank, Bank of Industry and Mine, Export Development Bank of Iran, Refah Bank and Keshavarzi Bank.

“The Austrian bank’s resources will be allocated to finance authorized state and private infrastructure and production projects,” the Tehran-based central bank said in a statement published on its website.

Oberbank increased its net profit by 8.9 percent to 181 million euros in 2016, with total assets worth 19.16 billion. It owns a 26-percent stake in the Italian UniCredit bank.

Also on Thursday, Denmark’s Danske Bank signed a similar finance contract worth €500 million with 10 Iranian banks, becoming the second European lender to ink such an agreement with Iran.